What type of economic system involves the government making all production and consumption decisions?

A centrally planned economy is characterized by significant government intervention, where the state makes all decisions regarding the production and consumption of goods and services. This system contrasts with free market economies, where individuals and businesses make these decisions based on supply, demand, and competition. In a centrally planned economy, the government often dictates what to produce, how much to produce, and at what price goods should be sold. This can lead to a focus on achieving specific economic goals, such as redistribution of wealth or meeting social needs, rather than responding to market signals.

In mixed economies, elements of both government intervention and free market principles are present; thus, decision-making is shared rather than solely controlled by the government. Capitalism generally refers to an economic system where private individuals own and control property and businesses, operating with minimal government intervention. These alternatives highlight distinct approaches to economic management and decision-making compared to a centrally planned economy.